UPSC Prelims Practice Questions — Central Government temporarily exempts all customs duties on import of cotton from 1st June, 2026 till 31st October, 2026

Q1. The temporary exemption of all customs duties on cotton imports for the period 1 June 2026 to 31 October 2026 was operationalised through a notification issued by which one of the following?

  • A. Department of Revenue, Ministry of Finance
  • B. Directorate General of Foreign Trade, Ministry of Commerce and Industry
  • C. Office of the Textile Commissioner, Ministry of Textiles
  • D. Department of Agriculture and Farmers' Welfare, Ministry of Agriculture

Q2. The power to grant such a time-bound exemption from customs duty on cotton imports is exercised primarily under which one of the following statutes?

  • A. Section 25 of the Customs Act, 1962
  • B. The Foreign Trade (Development and Regulation) Act, 1992
  • C. Section 5 of the Central Goods and Services Tax Act, 2017
  • D. The Agricultural Produce (Grading and Marking) Act, 1937

Q3. The three duty components exempted on cotton imports (Basic Customs Duty, Agriculture Infrastructure and Development Cess and Social Welfare Surcharge) are levied and their exemption implemented through customs notifications issued by which subordinate body?

  • A. Central Board of Indirect Taxes and Customs (CBIC)
  • B. Central Board of Direct Taxes (CBDT)
  • C. Directorate of Revenue Intelligence (DRI)
  • D. Directorate General of Foreign Trade (DGFT)

Q4. With reference to the customs levies exempted on cotton imports in 2026, consider the following statements: 1. Basic Customs Duty on cotton was levied at 5% prior to the exemption. 2. The Agriculture Infrastructure and Development Cess on cotton was levied at 10%. 3. The Social Welfare Surcharge was levied at 10% computed on the aggregate of the customs duties. Which of the statements given above is/are correct?

  1. Basic Customs Duty on cotton was levied at 5% prior to the exemption.
  2. The Agriculture Infrastructure and Development Cess on cotton was levied at 10%.
  3. The Social Welfare Surcharge was levied at 10% computed on the aggregate of the customs duties.
  • A. 1 and 2 only
  • B. 1 and 3 only
  • C. 2 and 3 only
  • D. 1, 2 and 3

Q5. With reference to the earlier temporary exemptions of customs duty on cotton imports, consider the following statements: 1. The 2022 exemption on cotton imports remained in force up to and inclusive of 30 September 2022. 2. The exemption granted in 2025 was initially valid till 30 September 2025 and was later extended to 31 December 2025. 3. The 2025 cotton import duty exemption first came into effect from 1 June 2025. Which of the statements given above is/are correct?

  1. The 2022 exemption on cotton imports remained in force up to and inclusive of 30 September 2022.
  2. The exemption granted in 2025 was initially valid till 30 September 2025 and was later extended to 31 December 2025.
  3. The 2025 cotton import duty exemption first came into effect from 1 June 2025.
  • A. 1 and 2 only
  • B. 1 and 3 only
  • C. 2 and 3 only
  • D. 1, 2 and 3

Q6. The recurring temporary exemptions on cotton imports, such as those of 2022 and 2025, have been notified under the authority of which one of the following?

  • A. Ministry of Finance
  • B. Ministry of Textiles
  • C. Ministry of Commerce and Industry
  • D. Ministry of Agriculture and Farmers' Welfare

Q7. About 65% of India's cotton production is accounted for by how many states?

  • A. Two
  • B. Three
  • C. Four
  • D. Five

Q8. Bt cotton, the only genetically modified crop approved for commercial cultivation in India, was cleared by which one of the following bodies?

  • A. Genetic Engineering Appraisal Committee (GEAC)
  • B. Indian Council of Agricultural Research (ICAR)
  • C. Food Safety and Standards Authority of India (FSSAI)
  • D. Protection of Plant Varieties and Farmers' Rights Authority

Q9. The Agriculture Infrastructure and Development Cess (AIDC) was introduced for the first time in which Union Budget?

  • A. Union Budget 2019-20
  • B. Union Budget 2020-21
  • C. Union Budget 2021-22
  • D. Union Budget 2022-23

Q10. Consider the following items: 1. Gold 2. Petrol and diesel 3. Wheat 4. Alcoholic beverages Which of the above is/are correctly identified as goods on which the Agriculture Infrastructure and Development Cess (AIDC) is levied?

  1. Gold
  2. Petrol and diesel
  3. Wheat
  4. Alcoholic beverages
  • A. 1 and 3 only
  • B. 2 and 4 only
  • C. 1, 2 and 4 only
  • D. 1, 2, 3 and 4

Q11. The Cotton Corporation of India (CCI), the central nodal agency for Minimum Support Price procurement of cotton, functions under which one of the following ministries?

  • A. Ministry of Textiles
  • B. Ministry of Agriculture and Farmers' Welfare
  • C. Ministry of Consumer Affairs, Food and Public Distribution
  • D. Ministry of Commerce and Industry

Q12. Consider the following statements about India's cotton economy: 1. India is the second largest producer of cotton in the world. 2. Gujarat, Maharashtra and Telangana together account for about 65% of India's cotton production. 3. Cotton is primarily a rabi season crop in India. 4. The Cotton Corporation of India is the central nodal agency for MSP procurement of cotton. Which of the statements given above are correct?

  1. India is the second largest producer of cotton in the world.
  2. Gujarat, Maharashtra and Telangana together account for about 65% of India's cotton production.
  3. Cotton is primarily a rabi season crop in India.
  4. The Cotton Corporation of India is the central nodal agency for MSP procurement of cotton.
  • A. 1, 2 and 3 only
  • B. 1, 2 and 4 only
  • C. 2, 3 and 4 only
  • D. 1, 2, 3 and 4